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Calling Bitcoin a "payment innovation," Fed Chair Janet Yellen said it is not easy to supervise the digital currency because "there's no central issuer or network operation."
February 27 -
At Janet Yellen's first appearance on Capitol Hill as the head of the Federal Reserve Board, the country's top central banker did little to depart from her predecessor's views on key issues, often cautiously echoing his message from the past eight years.
February 11 -
Fed Vice Chair Janet Yellen touched on a variety of regulatory issues during her lengthy confirmation hearing, including the Volcker Rule, efforts by regulators to be more transparent, and how to supervise systemically important nonbank firms.
November 14
WASHINGTON The Federal Reserve Board is likely to begin voting on significant enforcement actions against financial institutions, Chair Janet Yellen said Thursday.
Her endorsement of the idea came after pressure from Sen. Elizabeth Warren, who has pressed the central bank for months to elevate the importance of supervisory actions.
The Massachusetts Democrat raised the issue once again during a Senate Banking Committee hearing with Yellen, asking her if she would support requiring a board vote for enforcement actions.
"Senator, I think that you have raised very important questions about this and I do think it's appropriate for us to make changes and I fully expect that we will," said Yellen, who was there to testify about the Fed's semiannual monetary policy report.
The answer was a shift from Yellen's previously expressed view during her Nov. 14 confirmation hearing, where Warren first called on the then-nominee to ensure bank supervision of the country's largest institutions is on equal footing with the central bank's monetary policy decision-making.
"I'm concerned that those responsibilities just aren't a top priority for the Board of Governors," Warren said at the time.
Speaking in November, Yellen said that even if the board didn't hold a vote, it was not an indication that governors had not deliberated on the matter.
"When there are delegations to staff and the Board of Governors doesn't vote, that doesn't mean that board members aren't consulted, and maybe those with expertise may have played a critical role and have very important input even where there is no formal vote by the Board of Governors," said Yellen during her confirmation hearing.
But Warren has returned to the issue since then. She, along with Rep. Elijah Cummings, D-Md., sent a letter to Yellen two weeks ago requesting the Fed change its procedures and require the board to vote on major settlements.
She also raised the concern again at the hearing on Thursday.
"While the Fed's Board of Governors votes on every important monetary policy decision, the Board rarely votes on issues like whether to settle enforcement actions," said Warren, specifically citing regulators' $9.3 billion settlement with mortgage servicers, which was not voted on by the board.
As a matter of practice, the Fed delegates enforcement matters to staff in the area of supervision, but is required to vote on supervisory findings, mergers and acquisitions, and rule changes.
At Thursday's hearing, Warren also asked whether Yellen would be willing to voluntarily disclose more details on future settlements.
She and Sen. Tom Coburn, R-Okla., have introduced a bill called the Truth in Settlements Act which would require such disclosures, including how the agreement was calculated. But the senator pointed out that the Fed could act on its own and not wait for Congress.
The Fed chair said she also agreed in "principle" in increasing the level of transparency of such settlement agreements, but would have to give the issue more thought.
"It's important for us to disclose more and to disclose as much as we can," Yellen said. "We'll look at that very carefully and try to provide more information."
